Western Midstream Announces Acquisition of Brazos Delaware

Rhea-AI Summary

Western Midstream (NYSE: WES) will acquire Brazos Delaware II for approximately $1.6 billion in a 50% cash / 50% equity transaction expected to close late Q2 2026. The deal adds ~470,000 dedicated acres and 460 MMcf/d nameplate processing capacity.

The acquisition increases WES Delaware dedicated acres ~49% to >1.4 million and processing capacity ~20% to ~2.750 Bcf/d, is expected to be immediately accretive to estimated 2026 distributable cash flow per unit, and supports pro forma net leverage of ~3.0x in 2026.

AI-generated analysis. How Rhea-AI works. Not financial advice.

Positive

• $1.6B acquisition expands Delaware Basin footprint
• Adds 470,000 dedicated acres to WES portfolio
• Adds 460 MMcf/d processing capacity at Comanche
• Weighted average contract life > 9 years
• Pro forma net leverage targeted at ~3.0x

Negative

• $800M cash required at closing
• Issuance of $800M in common units causes dilution
• Transaction subject to customary regulatory approvals
• Purchase multiple of ~8.0x on 2027 estimated EBITDA

News Market Reaction – WES

+4.97%

+4.97% News Effect

On the day this news was published, WES gained 4.97%, reflecting a moderate positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

What This Means

This announcement highlights WES’s continued build-out of its Delaware Basin platform through the Br...

Analysis

This announcement highlights WES’s continued build-out of its Delaware Basin platform through the Brazos acquisition, adding 470,000 dedicated acres and 460 MMcf/d of gas processing capacity. The deal targets immediate accretion to 2026 Distributable Cash Flow per unit while keeping pro forma net leverage near 3.0x. Historically, acquisition news for WES has produced modest, mixed price moves, so investors may focus on integration progress, realized synergies, and how throughput trends track against the expanded 2.750 Bcf/d processing footprint.

Key Figures

Purchase price: $1.6 billion Cash consideration: $800 million Equity consideration: $800 million +5 more

8 metrics

Purchase price $1.6 billion Total consideration for Brazos Delaware acquisition

Cash consideration $800 million Cash portion of Brazos transaction at closing

Equity consideration $800 million Value of WES common units to be issued at closing

Valuation multiple ~8.0x Multiple on 2027 estimated EBITDA, declining to ~7.5x with synergies

Pro forma net leverage 3.0x Expected maintained leverage throughout 2026

Dedicated acres added 470,000 acres Brazos Delaware dedicated acreage under long-term contracts

Gas processing capacity added 460 MMcf/d Nameplate natural-gas processing at Comanche complex

Total Delaware dedicated acres More than 1.4 million WES total Delaware Basin dedicated acreage post-transaction

Previous Acquisition Reports

5 past events · Latest: Oct 15 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Oct 15	Acquisition completion	Positive	+1.0%	Completion of Aris Water Solutions acquisition with mixed cash and unit consideration.
Oct 08	Merger elections	Positive	+1.6%	Preliminary Aris holder elections showing mix of cash and WES units within cash cap.
Oct 08	Merger elections	Positive	+1.6%	Preliminary merger consideration results with capped cash and planned unit issuance.
Sep 29	Merger update	Positive	-2.5%	Election deadline and HSR Act waiting-period expiration for Aris merger process.
Sep 29	Merger update	Positive	-2.5%	Aris merger election mechanics and HSR expiration ahead of planned closing.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent acquisition-related headlines have produced small, mixed price reactions, with a slight negative average move, indicating that deal news has not consistently re-rated the units.

Recent Company History

Over the past year, WES has been active in M&A, particularly around the Aris Water Solutions transaction. From late September–October 2025, multiple acquisition milestones, including election deadlines and final consideration terms, saw modest moves between roughly +1% and -2.5%, with an average move of about -0.16%. These deals expanded WES’s Delaware Basin footprint and three-stream capabilities. Today’s Brazos Delaware acquisition continues that strategy of bolt-on growth and integration in the basin.

Key Terms

ebitda, distributable cash flow, net leverage, mmcf/d, +4 more

8 terms

ebitda financial

"represents an ~8.0x multiple on 2027 estimated EBITDA(1), declining to"

EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It measures a company's profitability by focusing on the money it makes from its core operations, ignoring expenses like taxes and accounting adjustments. Investors use EBITDA to compare how well different companies are performing financially, as it provides a clearer picture of operational success without the influence of financial structure or accounting choices.

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distributable cash flow financial

"Expected to be immediately accretive to estimated 2026 Distributable Cash Flow per unit."

Distributable cash flow is the amount of money a business generates from its operations that management considers available to pay dividends, buy back shares, or make other distributions to owners after setting aside what’s needed to keep the business running and meet routine obligations. Investors care because it shows how much real cash can be returned to them—like a household’s leftover paycheck after paying rent and groceries—and helps judge whether payouts are sustainable and backed by operations rather than accounting entries.

net leverage financial

"enabling WES to maintain pro forma net leverage of approximately 3.0x throughout 2026."

Net leverage measures how many years it would take for a company to pay off its outstanding debt using its annual operating cash flow, after subtracting cash on hand from total debt. Think of it like a household’s mortgage balance minus savings divided by yearly income; a lower number means the company is in a safer position to handle debt, while a higher number signals greater financial risk and potential pressure on profits or growth.

mmcf/d technical

"460 MMcf/d of natural-gas processing capacity, increasing WES's total"

mmcf/d stands for million cubic feet per day, a measure of how much natural gas is produced, transported or consumed each day. Investors watch it because daily gas flow directly affects a producer’s revenue potential and operational capacity—think of it like tracking how many gallons per day a factory fills: higher, steady flow usually means more sales and clearer forecasts, while drops or variability can signal problems or changing demand.

bcf/d technical

"natural-gas processing capacity by approximately 20-percent to approximately 2.750 Bcf/d."

A measure of natural gas volume equal to one billion cubic feet delivered or produced each day (bcf/d). Investors use it like a speedometer for gas flow: higher bcf/d figures mean more product to sell, greater revenue potential, and a bigger effect on market supply and prices, while drops can signal lower income or tighter market conditions.

mbbls/d technical

"processed an average of 336 MMcf/d of natural gas and 25 MBbls/d of crude oil"

mbbls/d denotes a flow rate of crude oil or petroleum products equal to thousands of barrels per day (one barrel is 42 U.S. gallons). It tells investors how much oil a company or facility is producing, transporting, or processing each day, so it directly affects potential sales, cash flow and market supply; think of it like how many gallons per minute a water pump moves, but on an industrial, revenue-driving scale.

fixed-fee contracts financial

"under long-term, fixed-fee contracts with a weighted average remaining"

Fixed-fee contracts are agreements where a seller or service provider is paid a set, unchanging amount for delivering a defined product or service over a specified period, regardless of how much the work ultimately costs. For investors this matters because fixed fees create predictable revenue or expense streams, concentrate risk on the party covering cost overruns, and can affect margins and cash flow stability much like a flat-rate subscription versus pay-as-you-go billing.

investment grade financial

"anchored by high-quality, investment grade counterparties with a portfolio-wide"

A credit rating label assigned to bonds or borrowers that signals relatively low risk of default; think of it as a strong health check for a company's or government's ability to repay debt. It matters to investors because investment-grade status typically means lower interest costs for the borrower, greater eligibility for conservative funds and pension portfolios, and generally more stable returns compared with higher-risk, non-investment-grade debt.

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• Expands WES's natural-gas and crude-oil and NGLs gathering and processing footprint across the core of the Delaware Basin.
• Adds approximately 470,000 dedicated acres and 460 MMcf/d of natural-gas processing capacity, increasing WES's total Delaware Basin dedicated acres by approximately 49-percent to more than 1.4 million acres and natural-gas processing capacity by approximately 20-percent to approximately 2.750 Bcf/d.
• Diversifies WES's customer base through long-term, fixed-fee contracts anchored by high-quality, investment grade counterparties with a portfolio-wide weighted average remaining contract life of over nine years.
• Purchase price of $1.6 billion represents an ~8.0x multiple on 2027 estimated EBITDA⁽¹⁾, declining to ~7.5x with the commercialization of available processing capacity and identified synergies.
• Expected to be immediately accretive to estimated 2026 Distributable Cash Flow per unit.
• Transaction consideration consists of 50-percent cash and 50-percent equity, enabling WES to maintain pro forma net leverage of approximately 3.0x throughout 2026.

HOUSTON, May 6, 2026 /PRNewswire/ -- Western Midstream Partners, LP ("WES" or the "Partnership") (NYSE: WES) today announced that it has entered into a definitive agreement pursuant to which WES will acquire all of the outstanding equity interests of Brazos Delaware II, LLC ("Brazos"), in a transaction valued at approximately $1.6 billion. Under the terms of the agreement, WES will pay approximately $800 million in cash and issue approximately $800 million in WES common units at closing. The transaction is subject to customary closing conditions and regulatory approvals and is expected to close late in the second quarter of 2026.

Brazos is one of the largest privately held gathering and processing platforms in the Texas Delaware Basin, with natural-gas and crude-oil assets spanning Reeves, Ward, Pecos, Winkler, Culberson, and Loving counties. Brazos's assets include approximately 900 miles of pipeline, 460 MMcf/d of nameplate natural-gas processing capacity at the Comanche processing complex, and approximately 470,000 dedicated acres under long-term, fixed-fee contracts with a weighted average remaining contract life of more than nine years. The Brazos business, which processed an average of 336 MMcf/d of natural gas and 25 MBbls/d of crude oil in full-year 2025, is supported by a diversified portfolio of investment grade and private-equity backed Permian Basin focused producers. Nearly all drilling locations on acreage dedicated to Brazos are within two miles of the low-pressure infrastructure, limiting future growth capital needs and increasing Free Cash Flow generation.

CEO COMMENTARY

"We are very pleased to announce the acquisition of Brazos – a highly complementary and strategically compelling bolt-on addition to our existing Delaware Basin platform," commented Oscar K. Brown, President and Chief Executive Officer of WES. "The Brazos acquisition is in line with WES's M&A philosophy of making accretive, strategic acquisitions that enhance the value of WES's existing asset base, provide a diverse set of high-quality customers, and generate strong Free Cash Flow, all while protecting our investment grade credit ratings. More than 60-percent of WES's 2026 Adjusted EBITDA is expected to be generated from the Delaware Basin, and that proportion will only grow as the Brazos transaction is closed and integrated, and our organic growth projects, including the Pathfinder Pipeline and North Loving II, come online in the first and second quarters of 2027, respectively."

"Now that the Aris integration is complete, the combination of the Brazos and WES systems creates an even more integrated Delaware Basin network that is better positioned to compete for new business, provide enhanced flow assurance for our customers, and deliver incremental operational efficiencies across a broader footprint. With approximately 3,500 identified drilling locations at $65 per barrel, WES has line of sight to decades of new throughput. The addition of the Comanche processing complex also further strengthens our position as one of the largest natural-gas processors in the basin and provides meaningful capacity to support anticipated throughput growth from the Woodford and other high-return formations on the dedicated acreage."

"The Brazos acquisition is consistent with our disciplined approach to capital deployment, and our strong balance sheet and significant liquidity position has enabled us to take advantage of strategic M&A opportunities when they arise. Additionally, Brazos's strong Free Cash Flow conversion will support our goal of increasing distribution coverage while still delivering mid-to-low single digits annual distribution growth and maintaining our peer-leading leverage ratio," Mr. Brown concluded.

TERMS OF ACQUISITION

Under the terms of the agreement, WES will pay approximately $800 million in cash and issue approximately $800 million in WES common units at closing. WES expects to maintain pro forma net leverage of approximately 3.0x throughout 2026. For additional details on WES's acquisition of Brazos, please refer to the slide presentation available under the "Events and Presentations" tab at www.westernmidstream.com.

ADVISORS

Greenhill, a Mizuho affiliate, served as financial advisor and Troutman Pepper Locke LLP served as legal advisor to WES. Jefferies LLC served as financial advisor and Vinson & Elkins LLP served as legal advisor to Brazos.

ABOUT BRAZOS MIDSTREAM

Headquartered in Fort Worth, Texas, the Brazos Midstream entities ("Brazos Midstream") collectively represent the largest privately held midstream platform in the Permian Basin. On a combined basis, including both Brazos and Brazos Midland, Brazos Midstream's critical hydrocarbon infrastructure totals approximately 1,200 miles of natural-gas, natural-gas liquids and crude-oil gathering pipelines spanning the most prolific producing counties in the Midland and Delaware Basins; approximately 1.0 Bcf/d of total Permian-based processing capacity with expansion projects underway to expand to approximately 1.3 Bcf/d by year-end 2026; and 75,000 barrels of crude oil storage.

ABOUT WESTERN MIDSTREAM

Western Midstream Partners, LP ("WES") is a master limited partnership formed to develop, acquire, own, and operate midstream assets. With midstream assets located in Texas, New Mexico, Colorado, Utah, and Wyoming, WES is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids, and crude oil; and gathering, transporting, recycling, treating, and disposing of produced water for its customers. In its capacity as a natural-gas processor, WES also buys and sells residue, natural-gas liquids, and condensate on behalf of itself and its customers under certain gas processing contracts. A substantial majority of WES's cash flows are protected from direct exposure to commodity-price volatility through fee-based contracts.

For more information about WES, please visit www.westernmidstream.com.

(1)	This is a non-GAAP financial measure. Forecasted EBITDA is based on WES's projections for the business to be acquired. Forecasted EBITDA is not presented as an alternative to the nearest GAAP financial measure, net income, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. We are unable to present the most directly comparable GAAP measure or a reconciliation of forecasted EBITDA to net income because certain elements of net income, including interest, depreciation and taxes, are not available without unreasonable effort.

FORWARD-LOOKING STATEMENTS

This news release contains forward-looking statements. WES's management believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this news release. These factors include our ability to close and realize the expected benefits from the Brazos acquisition; meet financial guidance or distribution expectations; our ability to safely and efficiently operate WES's assets and integrate the Brazos assets into our portfolio; the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services; our ability to meet projected in-service dates for capital-growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the "Risk Factors" section of WES's most-recent Form 10-K filed with the Securities and Exchange Commission and other public filings and press releases. WES undertakes no obligation to publicly update or revise any forward-looking statements, except as required by applicable law.

WESTERN MIDSTREAM CONTACTS
Daniel Jenkins
Director, Investor Relations
Investors@westernmidstream.com
866.512.3523

Rhianna Disch
Manager, Investor Relations
Investors@westernmidstream.com
866.512.3523

 

 

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SOURCE Western Midstream Partners, LP

FAQ

What are the key terms of Western Midstream's (WES) acquisition of Brazos Delaware announced May 6, 2026?

WES will acquire Brazos for approximately $1.6 billion, paying ~$800 million cash and issuing ~$800 million of common units. According to the company, the deal is expected to close late in Q2 2026, subject to customary conditions and approvals.

How much acreage and processing capacity does Brazos add to WES's Delaware Basin portfolio?

The acquisition adds approximately 470,000 dedicated acres and 460 MMcf/d nameplate natural-gas processing capacity. According to the company, this increases WES's Delaware dedicated acres by ~49% and processing capacity by ~20%.

What is the expected financial impact of the Brazos purchase on WES distributable cash flow and leverage?

WES expects the transaction to be immediately accretive to estimated 2026 distributable cash flow per unit and to maintain pro forma net leverage of ~3.0x through 2026. According to the company, the 50/50 cash-equity structure supports that leverage target.

What contract and customer characteristics come with Brazos Delaware for WES shareholders?

Brazos brings ~470,000 acres under long-term, fixed-fee contracts with a portfolio-weighted average remaining life > 9 years. According to the company, contracts are anchored by investment-grade and private-equity-backed Permian producers.

What near-term operational synergies and growth prospects did WES cite for the Brazos acquisition?

WES cited an integrated Delaware network, enhanced flow assurance, identified synergies, and ~3,500 drilling locations visible at $65/barrel. According to the company, available processing capacity and identified synergies lower the transaction multiple to ~7.5x.